The electric industry has been undergoing a paradigm shift for over a decade; moving away from the central-station utility and its typically one directional power flow towards a decentralized model where energy can be generated from any number of points on a power grid from any number of distributed energy resources (DER). Factors driving this shift include increasing interest in generation from renewable resources, advances in new storage and generation technologies, growing demand-side participation in system operations, and a greater public expectation of grid resiliency. All are working in concert to create a new form of “disruptive technology” that, while perhaps is rightfully considered to be preferred, favorable advances with many beneficial impacts, is threatening the reliable operation of the distribution system. With the shift, a new “prosumer” market player has emerged who owns and operates active (distributed generation) resources to reduce its net consumption and where possible inject its surplus power into the grid. The increasing penetration of these distributed, customer-side resources and prosumers will not only strike directly at the utility bottom line, but just as important, will also add to requirements for system reliability. No longer can the distribution system passively allow electricity to simply follow from the high voltage transmission grid to the lower voltage distribution and customer grids. Rather, tomorrow's grid must be able to support bi-directional power flow where electricity can be injected from any number of different generation sources at any number of entry points to the system. At a minimum, these changes give rise to new operational problems for operators of the distribution system. Utilities will need to extend their visibility to customer-side assets and revamp their conventional distribution system operational procedures and tools to maintain reliable system operations.
With increased levels of variable generation, bulk power system operators also face a number of new issues, including the need for higher levels of reserves, ramping requirements, and new types of balancing and flexible reserve services. Reliance upon conventional (generation) resources to meet these requirements is unlikely, as a shift to promoting environmentally friendly resources is well underway and the operation of such conventional resources could be cost prohibitive. Rather, demand-side assets are likely to be increasingly relied upon by bulk power system operations to supplement (or even replace) conventional resources to provide such services. This increasing reliance will drive system operators' desire for visibility into or even control over the demand-side assets of prosumers. However, such visibility is limited today by structural, technological, and jurisdictional factors as well as others.
A new group of market players have also emerged, referred to by various names such as Curtailment Service Providers (CSPs), Aggregators of Retail Customers (ARCs), or more generally as Demand Response service Providers (DRPs) that sign up consumers/prosumers, aggregate their responsive demand or distributed generation and offer them to entities such as system or market operators, pocketing the difference between incentives they pay to consumers/prosumers, and revenues they get from system/market operators. Since their incentives are purely economic, they are generally oblivious to reliability impacts their operations may have on the distribution system. There is a need for improved coordination and control among them, the consumers/prosumers, and the system operators.
In addition, many prosumers are interested in opportunities to lower their cost of energy and to maximize value of their demand-side assets by adjusting consumption in response to prices, offering flexibilities in their usage in return for payments or incentives, or even engaging into bilateral transactions with other consumers and prosumers. Although traditional transactive techniques have been used in bulk power operation and trading in the U.S. since the mid-nineties, the concept of transactive energy has been emerging in the retail energy domain, thus extending the conventional wholesale level trades of energy and energy derivative products to retail and end-use prosumers.
As a result, a need has emerged for a new entity, the Distribution System Operator (DSO), as well as the supporting technology, and platform and the processes, required to support the DSO (referred to hereinafter as the Distributed System Platform “DSP”) to forecast distribution level demand and supply variations, and to the extent possible minimize the resulting imbalances to relieve the balancing burden on the bulk power operation. In addition, the DSP can aggregate demand-side flexibilities, or facilitate provisions of such capabilities by service provides, in support of the bulk and market operations. To maintain distribution system reliability such activities need to be coordinated and any adverse impact on distribution grid operations need to be analyzed, monitored and controlled. In carrying out this mission, to the extent possible, the DSP may use quantity, value, time, and location attributes.
The increased number of players and increased number of transactions places distribution grid reliability at risk. It is, therefore, of outmost importance for the operator of the distribution grid to have full visibility to these transactions, and the ability to exercise control, when needed. These issues have been developing for over a decade, yet prior to the systems and methods disclosed herein, no solution has been successful at mitigating them.